Why A Drawn-Out Ukraine War Creates Additional Risks For China

The threat of a drawn-out Ukraine war poses growing economic and diplomatic threats to China, given its dependence on exports to NATO and other western countries countries. China is already regarded with suspicion, if not outright hostility in the US and Europe as its surreptitious support of Russia undermines any advantages it may have gained to its manufacturing and technological power.

In addition, Chinese experts are increasingly concerned that the Russian ally on whom they rely, Vladimir Putin, has a tenuous hold on power. As a result, China is expected to push harder for a diplomatic solution to the Ukraine war, if only to reduce its own exposure to negative consequences. JL

James Areddy reports in the Wall Street Journal:

China has given Vladimir Putin diplomatic and economic backing for his war on Ukraine. But as the conflict drags into its 18th month with no sign of  capitulation on either side, Beijing faces an increasing set of risks that give it more incentive to push Moscow and Kyiv toward peace talks. A prolonged conflict promises diplomatic and economic ramifications for China. A dragged-out war is negative for China’s economy, its global development goals and its image in Europe. “With prominent Chinese theorists speculating that time may no longer be on Putin’s side, Xi must now grapple with losing the great-power clash he set in motion against the West.”.

China has given Russian President Vladimir Putin important diplomatic and economic backing for his war on Ukraine. But as the conflict drags into its 18th month with no clear sign of victory or capitulation on either side, Beijing faces an increasingly complicated set of risks that give it more incentive to push Moscow and Kyiv toward peace talks.

The shocking but short-lived rebellion by Russian paramilitary group Wagner in June has raised new questions about Putin’s hold on power and the possibility of a future Russia without the autocrat whom China’s leader Xi Jinping has called his best friend. It has also brought new focus to the risks of Beijing’s support for Moscow.

Xi is expected to dispatch Chinese peace envoy Li Hui to a Ukraine-backed international conference aimed at outlining the terms of a possible peace deal, according to European and U.S. officials. That would mark a significant shift, as Beijing stayed away from the group’s first meeting, held in Copenhagen in June.

This weekend’s gathering in Saudi Arabia, aimed at outlining principles that should frame a possible peace deal, includes a range of world powers sympathetic to Kyiv and excludes Russia. The spokeswoman for Russia’s Foreign Ministry on Wednesday said the meeting was “a hoax” intended to create an anti-Moscow coalition, according to Russian state news agency TASS.

Chinese participation would present a rare opportunity for U.S.-China engagement over the war as President Biden’s national security adviser, Jake Sullivan, is also expected to attend. Attendees will be watching for any sign that Beijing’s thinking about the conflict, and its end, has evolved.

Beijing’s flirtation with red lines set by the U.S. around wartime trade with Russia has strained its relations with the West and led to increased scrutiny, including in European capitals that China has sought to charm. And China continues to signal concern that nuclear weapons could be deployed—both a veiled warning to Moscow and a threat to the West to limit support for Ukraine.

China’s unease was on display last month at the United Nations General Assembly, when its deputy permanent representative, Geng Shuang, outlined stark concerns about the enduring war. “The Ukraine crisis has dragged on to this day with no signs of easing on the ground, military logic still prevailing, and slow progress in peace talks, which all point to a worrying prospect,” Geng said. He called for peace talks to promote “an early cease-fire and political solution.”

Geng’s lengthy tally of the broader risks of the war, including nuclear-weapons use, contrasted with a presentation by Geng to the U.N. in March, shortly after Beijing publicized a 12-point position paper on resolving the conflict. During that earlier presentation, Geng blasted the U.S. for what he called “Russiaphobia.”

In his latest U.N. presentation, Geng minimized finger-pointing and instead concentrated on issues like food security, which he mentioned three times. Days earlier Putin said Russia would pull out of a deal to permit safe Black Sea passage of Ukrainian grain. China has been the biggest market for that output.

“Based on official reportage, the sense one gets is that China’s concerns remain around escalation and spillovers,” according to Manoj Kewalramani, a China studies fellow at India-based think tank Takshashila Institution, who tracks statements by Beijing officials.

Kewalramani also pointed to a recent commentary published in the Communist Party’s People’s Daily newspaper expressing concern that the U.S. was using the war as a pretext to open new fronts to confront Beijing, such as expanding the North Atlantic Treaty Organization’s mandate to Asia.

“The U.S. has attempted to link the Ukraine crisis with Asia-Pacific affairs, threatening European countries to ‘decouple’ from China and pressuring them to participate in its so-called Indo-Pacific strategy,” according to the commentary by Zhang Jian, a vice president at the Beijing-based think tank China Institutes of Contemporary International Relations.

While neither side in Ukraine appears to have the upper hand, a prolonged conflict promises diplomatic and economic ramifications for China. Whereas Beijing has sought to position itself as a peacemaker, it has sometimes misstepped, for instance when in April its top diplomat in France appeared to call into question the legal basis for the sovereignty of some former Soviet republics. Now diplomatic endeavors are clouded by the mysterious departure of Xi’s handpicked foreign minister, Qin Gang.

Xi has demonstrated little follow-through to his springtime effort to mediate in the conflict, which included dispatching diplomats to Europe to promote February’s 12-point position paper. Xi hasn’t repeated his single wartime telephone conversation three months ago with Ukrainian President President Volodymyr Zelensky, despite continued dialogue with Putin.

Beijing has failed to convince Western officials that it can be seen as neutral in the conflict due to Xi’s tight relationship with Putin. Distrust of Xi and China is widespread around the world, according to a newly published survey by Pew Research Center that said a median of 71% of respondents in 24 nations viewed the country as not contributing to global peace and stability.

A dragged-out war is negative for China’s economy, its global development goals and its image in Europe, but Beijing hasn’t clearly adjusted its messaging, according to Philippe Le Corre, a senior fellow at the Asia Society Policy Institute. “No one is impressed with the ‘12-point peace plan’ nor was anyone impressed with Qin Gang when he visited Europe,” said Le Corre. Critics of the plan’s call for a cease-fire say the effect would be to cede to Russia the roughly 20% chunk of Ukraine it controls, including Crimea, which Moscow annexed in 2014.

China is engaged in a “balancing act” of being supportive of Russia while trying to present itself as a neutral player and a force for peace, “and that strain is increasingly apparent,” U.S. Secretary of State Antony Blinken told Richard Haass of the Council on Foreign Relations shortly after his June sit-down with Xi.

Still, Beijing’s “certain amount of influence” with Moscow could be useful once diplomacy to end the war has realistic prospects of achieving results, Blinken said.

A welcome to China reflects the Biden administration’s efforts to re-engage, but any notion that a mediating role for Beijing would drive a wedge between it and Moscow is misplaced, according to a recent letter to Blinken from 10 Republican senators. They called for blocking Beijing out of any Ukraine settlement by saying, “The administration’s policy should not allow China to absolve itself for its support of Russia or use this war for its longer-term political and economic benefit.”

François Godement, a special adviser to the French think tank Institut Montaigne, said Beijing isn’t trusted as a neutral party in Europe, and he cast doubt on its diplomatic acumen, which appeared to get a boost in March when China brokered a deal for Saudi Arabia and Iran to re-establish diplomatic ties.

“China’s real strength lies elsewhere: in its vastly increased commercial and tech attractiveness on all parties, and in the resulting impossibility to ignore China as an unavoidable partner with the capacity to reward or to punish,” Godement wrote recently.

Xi hasn’t reacted publicly to the challenge Putin appeared to face during the Wagner rebellion, but analysts say it likely rattled him. The policy newsletter GZERO Daily recently outlined why China’s leader might be compelled to press Moscow to end the war: “He’s giving Putin the ‘off ramp’ the Russian president can’t (or won’t) create for himself,” it said.

Xi appears unwavering in his support for Russia, for instance meeting a Putin ally in July—the head of the upper chamber of the Russian Parliament, Valentina Matvienko—then days later snubbing President Biden’s climate envoy, John Kerry. More quietly, China in July also welcomed to Beijing a Ukrainian trade envoy, Taras Kachka, with a vow to increase the country’s imports from Ukraine.

The Chinese narrative “retains just enough ambiguity that the Chinese Communist Party could claim later they never backed Putin’s war,” according to Godement.

Beijing faces scrutiny of its deepening trade with Russia, at a time when Western capitals are looking to further punish Moscow for the Ukraine invasion by freezing it out of the global economy and limiting its access to weaponry.

A U.S. report in July by the Office of the Director of National Intelligence said government-owned companies in China have exported to Russia ship navigation equipment, jamming technology and jet-fighter parts, while importing energy and underwriting insurance on Russian ships. The report also cited press findings that China has supplied drones and semiconductors to Russia.

But the U.S. intelligence report said the use of shell companies in China, misrepresented documentation and complex supply chains make it difficult to know how much China has helped Russia evade sanctions and export controls.

During a recent two-week trip around China, Scott Kennedy of the Washington think tank Center for Strategic and International Studies didn’t hear any serious ideas for ending the war, only that Ukraine should accept a cease-fire. Kennedy said one expert he met warned that the West should understand that Russia could deploy tactical nuclear weapons out of desperation.

“The takeaway is unsurprising. Instead of criticizing Russia and proposing it come to its senses and withdraw, they offer this as another reason for the U.S. and West to stop arming Ukraine,” according to Kennedy.

The fizzling of the Wagner revolt and the limited progress of Ukraine’s offensive may give China’s leader, Xi, near-term comfort, according to Craig Singleton, a senior fellow at Washington think tank Foundation for Defense of Democracies. But, he said, that is temporary: “With prominent Chinese theorists speculating that time may no longer be on Putin’s side, Xi must now grapple with losing the very great-power clash he set in motion against the West.”